Trading trigger - sell signal, very weak cycle high is expected 2/3 of the time 27 days it is moving lower.
Analysis - long term sell the rips, I think we have major top. Close to intermediate term low.
P.S. - for a trade both analysis and trigger should point in the same direction.
TECHNICAL PICTURE and ELLIOTT WAVES
Short term - not clear what exactly is going on. Very deep retracement so the possible patterns are flat and triangle... or the decline is not over.
Intermediate term - I see W-x-Y with complex double zig-zag for Y=W. SP500 trying to find bottom, after that we should see the completition of some kind of b-wave - either in the b-wave(white) already or it will start soon(green).
Long term - We saw the high, if we are lucky this is b-wave, if not huge double zig-zag from 2009 was completed and it will get very ugly.
MARKET BREADTH INDICATORS
Market Breadth Indicators - look like nearing a bottom, the sell off looks exhausted.
McClellan Oscillator - turned below zero, expecting to see divergence.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - in the middle of the range.
Percent of Stocks above MA50 - turned lower higher low so far.
Fear Indicator VIX - lower high.
Advance-Decline Issues - higher low.
HURST CYCLES
Short term cycles - expecting to see 10w low soon or we saw it already.
Week 8 for the 20w cycle.
Long term we have 4 year cycle high and transition from up to down. The 18m low either late September with one extra 20w cycle or alternate on time in June/July... waiting to see how the pattern will play out to confirm one of the two options.
If the 18m low was in late September the indices should be close to 40w low. The European indices have very clear low most likely 40w low, which means the 18m low was in the summer of 2021.
A large gap down from here would be best strategically - longs trapped, margin calls Monday and wanna be shorts stuck waiting for a bounce which may not come for days. Thanks Krasi.
ReplyDelete”if not huge double zig-zag from 2009 was completed and it will get very ugly" What does the pattern look like for this scenario?
ReplyDeleteSee the chart from last week, it is RUT but it is the same for almost all indices.
DeleteIt looks like this option is playing out :-(
DeleteUpdated chart from last week in the comment section "what if it goes lower" - https://invst.ly/y3mmh
ReplyDeleteThere is no impulses so we need one more up and down to complete double zig-zag for c=1.618xa
Overall bearish price action is confirmed
- there is technical conditions for a low and the indices continue lower... there is no buyers.
- the next 40w high should be in June/July it is already May and the indices continue lower... we have bearish right translated 40w high which means correction higher in summer and continuation lower.
Excellent, thank you
DeleteSo, 40w in sp500 this week or the next one?
DeleteUsing the average length for 20w cycle 16-18 weeks in this case there is 1-3 weeks left before see a low.
DeleteWow Krasi, great analysis. Looks like SPY is following this forecast (c=1.618a)!
DeleteIf c=1.618a, that means about spx3600? Thx
DeleteMy Fibo measurements show 3740-3700
DeleteIs it possible the A Leg ended on Feb 23? If so the 1.618 is closer to 3500 - near to where the 200ma is
DeleteLooks like this leg of the correction is over for the short term.
ReplyDeleteFeels like it
DeleteKrasi, If the March 29 top was another A, then zig-zag down to C would probably reach 3500 area by end of may- early june. https://tvc-invdn-com.investing.com/data/tvc_72a0c46cb7f9611806657c9b6ce89df9.png
ReplyDeleteIs this a possibility? thank you
Such extension does not seem likely because sentiment and indicators are pretty negative. It has to be some kind of mini crash.... I do not know how to predict such thing.
DeleteKrasi - in the short term chart you wrote C=A 3740 and then C = 1.6 of A 3700. That 3700 number is way too short for a 1.6 extension. Is that a mistake? Did you mean to write 3400? thank you
ReplyDeleteMeasured with a-wave low late January.
Deletethanks very much
Delete